U.K. labor market cooled slightly in third quarter
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The U.K.’s unemployment rate edged up slightly from its lowest level in almost five decades, in a sign the country’s tight labor market is gradually cooling as the economy weakens.
The U.K. unemployment rate came in at 3.6% in the three months to September, up from the 3.5% registered from June to August, data from the Office for National Statistics showed Tuesday.
Economists polled by The Wall Street Journal expected the unemployment rate to remain at 3.5%.
The most recent estimate of payrolled employees show employment grew in October by 74,000 to a record of 29.8 million. However, the ONS data also showed a slight increase in jobless claimants over the month.
Despite a still-tight job market, labor demand showed signs of moderating in the three months to October. Job vacancies fell for a fourth consecutive quarter, but remained at a historically high level of 1.225 million.
Pay growth accelerated, a sign of persisting inflation pressures. Average weekly earnings excluding bonuses in the three months to September rose 5.7% on year, more than the 5.5% increase in the previous three-month period. This is the strongest growth in regular pay seen outside of the coronavirus pandemic period, the ONS said.
The U.K. economy contracted 0.2% in the third quarter, as high energy prices and rising interest rates mark the beginning of what policy makers expect will be a long-lasting recession.
Write to Xavier Fontdegloria at [email protected]
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